MELISSA BLOCK, HOST:
And now to New Mexico, where 30,000 mental patients have had their care thrown into disarray. This summer, the state froze Medicaid payments to several agencies. The reason: allegations of fraud. Now, that's left patients who suffer from PTSD, schizophrenia, and other severe disorders scrambling to find the help they need.
From member station KUNM in Albuquerque, Tristan Ahtone reports.
TRISTAN AHTONE, BYLINE: Gay Finlayson's son Neil was diagnosed with paranoid schizophrenia four years ago. But Neil has been without a therapist since June. Gay says having one is vitally important.
GAY FINLAYSON: I think of it as an anchor, that there's somebody who understands enough about his symptoms and how they ebb and flow to be able to give reassurance, to give hints on, you know, this is a plan for how you should deal with if you're hearing voices; this is a plan for if you're having thoughts that are harmful.
AHTONE: When New Mexico officials announced in June that they would suspend Medicaid payments to 15 behavioral health providers, patients were assured they would continue receiving care. Neil was one of those patients, but it took three months for Gay's son to finally start seeing a therapist again.
FINLAYSON: With Neil, it's about him coping every day with his illness, so I don't think that we're thinking big picture at this point. And I'm just really hoping that this works out.
AHTONE: The suspension of payments to mental health providers stems from allegations of fraud by the New Mexico Human Services Department. Spokesman Matt Kennicott says an audit found fraud to the tune of $36 million.
MATT KENNICOTT: The Human Services Department found that there were credible allegations of fraud, referred the 15 agencies to the New Mexico attorney general's Medicaid fraud control unit, and then suspended Medicaid payments.
AHTONE: Those agencies served 30,000 mental health patients in the state. Since the allegations, those providers have essentially ceased operations. Their Medicaid dollars and their patients are now under control of five Arizona firms, in what's being called a takeover.
PAUL WEEKS: The agency right now is very chaotic.
AHTONE: Paul Weeks is a therapist with one of those companies accused of fraud, Valencia Counseling Service. It's now being run by another company out of Phoenix.
WEEKS: All of the scheduled clients that I had have been taken off. There's no schedule, there's no computer, there's nothing.
AHTONE: When Weeks says there's no computer, he means no computer anywhere. The ousted managers took the computers with them. Because of that, all intakes are now being done by hand. Valencia Counseling had 2,000 clients, many of whom are now undergoing new assessments in order to receive services.
WEEKS: So the assessments take approximately two hours to complete. That's an assessment and a treatment plan. We have three, three and a half therapists there doing assessments. And generously we can do five assessments in a day.
AHTONE: Weeks' company never saw the audit. Neither have any other providers accused of fraud. And the people who have seen the actual audit, performed by an out-of-state firm, have a lot of questions including state auditor Hector Balderas. He subpoenaed the audit to verify that the state's Human Services Department - HSD for short - followed all state and federal regulations before handing New Mexico providers over to Arizona companies.
HECTOR BALDERAS: They specified, though, that even as they identified billing errors, they made a determination that credible allegation of fraud could and should only be made by the state of New Mexico. And that's what we're actively pursuing information and explanations from HSD.
FINLAYSON: I'm still a little nervous.
AHTONE: As disruptions continue in New Mexico's mental health system, people like Gay Finlayson and her son, Neil, say they'll continue to cope the best they can.
FINLAYSON: I'm pleased that he's got somebody that he can connect to. But I just know how tenuous the connection can be. So if things don't go well, starting over will not be easy.
AHTONE: Gay Finlayson says that if the new therapist doesn't work out, she'll be on the phone to find a new provider for her son. However, finding this one took three months. Finding another might take longer.
For NPR News, I'm Tristan Ahtone in Albuquerque. Transcript provided by NPR, Copyright NPR.